May 3 (Bloomberg) -- U.S. diplomats defended their handling
of a deal that led legal activist Chen Guangcheng to give up the
safety of the American embassy, saying he later had a “change
of heart” about his decision to stay in China.

Chen, a legal activist who is blind, was imprisoned for
more than four years after representing villagers who opposed
forced sterilizations. He consistently told U.S. diplomats
during a week-long stay in the embassy in Beijing that he wanted
to remain in China with his family, U.S. officials said.

“It is clear now that now in the last 12 to 15 hours they
as a family have had a change of heart about whether they want
to stay in China,” State Department spokeswoman Victoria Nuland
told reporters.

In a phone call from his hospital bed, Chen said he wants
to leave China as soon as possible, journalist Melinda Liu wrote
on the Daily Beast website today.

“My fervent hope is that it would be possible for me and
my family to leave for the U.S. on Hillary Clinton’s plane,” he
said. Secretary of State Clinton is in Beijing for cabinet-level
talks that began today.

That is unlikely because Chen and his family don’t hold
passports. To leave the country, they would need to get exit
permission as well as passports from Chinese authorities, and
also a visa from the U.S., where he could apply for asylum.
Under normal passport-application rules, they would have to
return to their home in Shandong province, which he fled after
house arrest and alleged beatings by local authorities.

‘Never Pressured’

Yesterday, Chen agreed to a deal the U.S. helped broker
with Chinese authorities that would have allowed him to relocate
within China and study law on a scholarship, U.S. Ambassador to
Beijing Gary Locke told reporters traveling with Clinton.

“I can tell you unequivocally that he was never pressured
to leave” the U.S. embassy in Beijing, Locke said. “We waited
for him to make his decision.”

U.S. officials had two telephone conversations with Chen
today and also met with his wife outside the hospital, Locke
said in an interview with ABC News. There will be further
discussions with them to “explore the options,” including
whether they now desire asylum in the U.S., Locke said.

Chen’s change of heart has upended the agreement,
overshadowing annual U.S.-China that are being attended by
Clinton and U.S. Treasury Secretary Timothy Geithner.

Political Fallout

Human rights groups, such as Amnesty International and
Human Rights Watch, questioned whether the Chinese government
assurances of Chen’s safety can be trusted. Further, Chen’s
earlier statements that he felt pressured to leave the U.S.
embassy may expose President Barack Obama to attacks from
Republicans for failing to protect a prominent rights activist.

“This is a big win for the Chinese authorities because the
attention ought to be focused on the wrongdoing which was
apparently done by either national or local officials to Chen,”
said Bates Gill, director of the Stockholm International Peace
Research Institute. “These developments will become a U.S.
domestic political distraction to criticize Obama and his
approach to China.”

U.S. Representative Chris Smith, a New Jersey Republican
who is chairman of the Congressional-Executive Committee on
China, called a hearing today on Chen’s situation. “The Obama
administration must do everything it can to ensure that Chen
Guangcheng, his family members and all those who have helped him
are removed from harm’s way and do not suffer any further abuse
or retaliation,” Smith said on his website.

Death Threat

Chen told CNN that after his escape his wife had been tied
to a chair in the family home for two days by police who
threatened to beat her to death. In an interview with the
Associated Press, he said that, while he’d been told he would be
safe in China, he began to fear for his family and felt the U.S.
had pressured him to leave the embassy.

In remarks Clinton delivered at the opening of the
Strategic and Economic Dialogue talks today, she shortened a
section of her prepared text that touched on human rights,
saying the U.S. “raises the importance of human rights and
fundamental freedoms” because it believes all governments must
heed their citizens’ “aspirations for dignity and the rule of
law.”

Chinese President Hu Jintao said his country and the U.S.
should “prove that the traditional belief that big powers are
bound to enter into confrontation and conflicts is wrong” and
that they should be committed to a “cooperative partnership.”

After Chen left the embassy, U.S. officials described a
deal with Chinese authorities permitting him and his family to
relocate in China so he could study law in safety at one of
seven universities, with his family’s living expenses paid for,
and said the U.S. would monitor China’s compliance.

‘Very Disappointed’

“The embassy kept lobbying me to leave and promised to be
with me at the hospital,” Chen told CNN, according to a
transcript. “But this afternoon soon after we got here, they
were all gone. I’m very disappointed at the U.S. government.”

Locke said Chen’s wife had urged him to come to the
hospital to be reunited with his family. He said Chen also
wanted Chinese authorities to make a gesture of good faith by
bringing his family to Beijing.

“We asked him what did he want to do, did he want to
leave, was he ready to leave,” Locke said. “We waited several
minutes and suddenly he jumped up very eager, very ready and
said, ‘Let’s go,’ in front of many, many witnesses.”

China’s foreign ministry demanded the U.S. apologize for
allowing Chen into the embassy, according to a statement
yesterday in which it also said China is “strongly
dissatisfied” with the U.S. handling of the case.

Leadership Transition

Chen’s flight to the U.S. Embassy comes ahead of a once-in-a-decade leadership change in China. Also, the Communist Party
is investigating Bo Xilai, the Chongqing party secretary whose
wife Gu Kailai is suspected of involvement in the murder of
British businessman Neil Heywood. The allegations about Heywood
were exposed by Bo’s former Chongqing police chief Wang Lijun,
who spent a night at the U.S. consulate in Chengdu in February
and was later taken into custody by Chinese authorities.

Chen, who was blinded by a fever in infancy and was
illiterate until his 20s, was jailed for more than four years
after filing a lawsuit protesting the forced sterilizations.
After his release in September 2010, he and his wife were
confined to their home. In a video recorded after his escape,
Chen said reports that he and his family were beaten during his
house arrest were true.

Chen’s case, which initially seemed like a foreign policy
success for the Obama administration, might now be used against
the president, who is campaigning for re-election in November,
said Kerry Brown, a former U.K. diplomat in China and head of
the Asia program at London-based Chatham House.

“It just looks very confusing -- it looks like they took
one position and then another,” Brown said in a phone
interview. “It plays into Romney’s hands,” he said, referring
to presumptive Republican nominee Mitt Romney.